Nexa Resources S.a. · NYSE:NEXA
Nexa Resources — Q2 2022 Earnings Presentation
20 slides from Nexa Resources's earnings presentation, Jul 28, 2022
Slide 1: Nexa Reports Second Quarter 2022 Results
US$ million (except per share amounts) 2Q22 2Q21 1H22 1H21 Nexa Reports Second Quarter 2022 Results including Adjusted EBITDA of US$286 Million Luxembourg, July 28, 2022 – Nexa Resources S.A. (“Nexa Resources”, “Nexa”, or “Company”) announces today its results for the three and six months ended June
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Slide 3: Aerial view
Aerial view First batch of copper in concentrate
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Slide 5: Administrative Plateau
Administrative Plateau Beneficiation Plant Aerial View
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Slide 7: Fuel Station for Mine/Mobile Equipment
Fuel Station for Mine/Mobile Equipment Workshop/Wheel Washer/Warehouse (right)
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Slide 9: Beneficiation Plant aerial view
Beneficiation Plant aerial view Pastefill Area
Slide 10: Compared to 1Q22, Adjusted EBITDA increased by 37%
Compared to 1Q22, Adjusted EBITDA increased by 37% mainly driven by the same reasons noted above in addition to higher sales volume with a positive impact of US$32 million.
Slide 11: Adjusted EBITDA bridge 1Q22 to 2Q22
US$ million +37% 18 Bo nnn | 40 ee 286 59 (6) (20) (8) (4) 208 + 1Q22 Volume Price effect Hedge FX By-products Other variable Min. Exp./ Other () 2Q22 and fixed Proj. Eval. costs + G&A Price Effect (1) Includes: Other income and expenses
Slide 12: Cost of sales increased by 22%
Cost of sales increased by 22% in 2Q22 compared to 2Q21, to US$216 million. This increase was due to higher operating costs resulting from inflationary cost pressures in maintenance, third-party services, personnel costs, logistics expenses, as well as increased workers participation provision and r
Slide 13: Compared to 1Q22, Adjusted EBITDA increased by 14%
Compared to 1Q22, Adjusted EBITDA increased by 14%, mainly driven by (i) higher volumes with a positive impact of US$45 million; and (ii) higher by-products credits of US$13 million; partially offset by (iii) the negative net price effect of US$9 million related to lower copper and lead prices, as w
Slide 14: Consolidated cash cost and AISC
Consolidated cash cost 2Q22 1Q22 2Q21 2Q22 vs. 2Q21 1H22 1H21 1H22 vs. 1H21 Cash cost and AISC 5 , 6 Cash cost net of by-products US$/t 19.6% (5.6%) AISC net of by-products US$/t 1,213 1,328 1,022 18.6% 1,266 1,128 12.2% Cash cost net of by-products US$/lb 0.16 0.19 0.14 19.6% 0.18 0.19 (5.6%) AISC
Slide 15: Zinc concentrate treatment charges
Zinc concentrate | treatment charges The smelters use zinc concentrate as feedstock, which is supplied from our mines and from third-party suppliers. In 2Q22, Nexa acquired 50% of zinc concentrate from our own mines, with the remainder supplied by third parties. Sources of Zinc Concentrate to Nexa S
Slide 16: Sources of zinc concentrate to Nexa smelters
Own mined 154kt Il 3rd parties Secondary 44%
Slide 17: Compared to 1Q22, Adjusted EBITDA increased by US$58 million
Compared to 1Q22, Adjusted EBITDA increased by US$58 million, mainly driven by (i) higher volumes of US$12 million; (ii) the net positive price effect of US$37 million related to higher zinc prices and changes in market prices resulting in quotation period adjustments ; (iii) the positive effect in
Slide 18: Adjusted EBITDA bridge 1Q22 to 2Q22
US$ million 3 —_—— (8) (1) 82 i H i 1Q22 Volume i Revenue Cost Price Hedge Tc FX By-products Other Other (1) 2Q22 | Price effect effect variable and laweteesressreseseneneuenensnereeenaneee fixed costs Price Effect + GBA (1) Includes: Other income and expenses and Project Evaluation
Slide 19: Nexa's balance sheet remains solid
Nexa’s balance sheet remains solid, and liquidity remains strong. Cash and cash equivalents and financial investments (“total cash”) amounted to US$633 million at June 30, 2022, 6% higher compared to March 31, 2022, mainly driven by the positive cash flow generation in the quarter. Total cash was su
Slide 20: Debt maturity and financial leverage
Only 2.4% (US$41 million) of the total debt matures in 2022, 13% (US$219 million) matures between 2023 and 2026, while 84% (US$1,411 million) of total debt matures after 2027. Financial leverage, measured by the ratio of net debt to Adjusted EBITDA of the last twelve months, decreased to 1.33x on Ju